In what is believed to be a unique move, Johnston bought 14.99 per cent of Portsmouth, which also operates a chain of convenience stores, including an 11.4 per cent stake from PDFM, and launched a tender offer to buy a further 10 per cent.
The offer has been priced at 1600p per share - a 35 per cent premium to Portsmouth's closing share price on Thursday - and will close on Saturday 30 January. Portsmouth shares closed at 1500p, up 315p.
Existing rules on newspaper ownership do not allow Johnston to own more than 24.99 per cent of Portsmouth without permission from the Government. The rules also state that a takeover of any newspaper with a circulation of more than 50,000 must be investigated by the MMC. Two of Portsmouth's titles are above that threshold.
Johnston said it had approached Portsmouth last November with a proposal for an agreed takeover bid. However, the talks broke down on 15 December. Last night Portsmouth directors were formulating a response in discussions with Charterhouse, their financial advisers.
Johnston's step is the latest move in the consolidation of the regional newspaper industry that has taken place in recent years. In 1996 the company, whose titles include the Falkirk Herald, bought EMAP's regional newspaper interests. Last year, Johnston lost out on a bid for Home Counties Newspapers after another newspaper operator, Eastern Counties, stepped in while the MMC was investigating the matter.
"It would be a good fit geographically and we would expect there to be synergies," said Tim Bowdler, Johnston's chief executive. Analysts said Johnston's move would discourage rivals from entering the fray while the MMC was considering the takeover.
"It's not unsurprising considering the regional press needs to consolidate further,'' said Angela Maxwell, an analyst with Sutherlands, the stockbroker. "The synergies would justify Johnston taking full control at some point. It would also expand their geographical coverage.''